Clock Running Out on Stand-Alone Broadband Commitment, Pai Warns

“The time is running short,” Pai said in an interview. “From the arcane perspective of the Administrative Procedure Act, I think we should tee up as soon as possible -- we should have done it a while ago, frankly -- our plan for solving the stand-alone broadband problem.”

Pai’s own stand-alone broadband proposal, offered in June (see 1506290039), is “a targeted way of solving the problem that I think has bipartisan support on Capitol Hill, has support from the industry and would be supported by consumers,” he said. “And it wouldn’t require us to herd a bunch of cats in order to solve some of the other problems with the high-cost fund. I’m growing a little nervous that we’re not going to be able to meet that deadline if we don’t act quickly, but I am hopeful nonetheless that the plan I put on the table will find the support of my colleagues.” Hill Republicans such as Sen. Deb Fischer, R-Neb., and Rep. Kevin Cramer, R-N.D., lauded the plan. The FCC didn't comment.

Sen. Cory Gardner, R-Colo., participated in a broadband roundtable with Pai in Denver Saturday and described “renewed focus” on stand-alone broadband following those meetings. “This morning, we met with rural telecom providers and people concerned about what’s happening in terms of broadband and rural communities,” Gardner told us Saturday. “We talked about the efforts to reach broadband opportunities to those rural areas.” When Gardner was a member of the House, he led a bipartisan letter pressing for stand-alone broadband support and signed onto Thune’s letter in the Senate this year. Cramer led a similar House letter this year and also participated with Pai in telecom events Tuesday in Fargo, North Dakota. Pai also has participated in events in Nevada and Montana following last week’s CTIA show.

NTCA is “certainly eager to see this debate resolved soon,” said Senior Vice President-Policy Michael Romano. “As long as the productive conversations continue and if we can focus on fixing the specific problem that Congress has raised as a concern, we hope we can at least make good, meaningful progress by year-end.” He lauded the progress so far and said options on the table “could and should form the core of a solution that can be adopted in the near future. ... What needs to happen from here is to complete the development, analysis, and testing of the other changes that the FCC is considering, and to then determine whether and to what degree those could be part of a package with a fix to the standalone broadband problem.”

Pai disagreed with Free Press on whether the FCC’s Communications Act Title II reclassification of broadband service is dampening broadband investment. Pai said last week that it is, and Free Press dismissed those claims in a fact sheet. The group said Pai is “either willfully misleading people or dangerously ignorant of the facts.”

“I’ve heard about it from some telecom carriers this morning in Colorado,” Pai told us Saturday. “I was in Reno, Nevada, yesterday where I heard about it from a number of different carriers including a wireless ISP that is working hard to provide connectivity to the Tahoe Reno industrial park. I’ve heard about it all over the country. So I think whether the provider is big or small, there’s no question that Title II factors into their investment decision. And that’s a regulatory line item that can only detract from the possibility of broadband deployment.”

“As for the invective that Free Press directed my way, sadly par for the course,” Pai said. “And frankly, I don’t credit a far-left interest group that was founded by somebody who praises Hugo Chavez and thinks the capitalist system should be dismantled brick by brick. I don’t think they have much wisdom to share on this and many other issues. … Personal attacks are their primary currency, and I would rather focus on what the facts are, what the law is and what consumers want. That debate is one in which reasonable people can disagree, but again, the invective that comes from them and other special interest groups within Washington is anything but informed.” Pai was referring to Robert McChesney, who co-founded Free Press in 2002 and was its president for several years until 2008.

"Pause first to note the rich irony: Commissioner Pai tries and fails to dismiss our arguments as nothing more than invective, yet goes straight to tired talking points about one of our co-founders who has no day-to-day involvement in our research, policy analysis or advocacy,” countered Free Press Policy Director Matt Wood. “Commissioner Pai is a skilled politician, but spare me the lecture against the tactics he's using himself. None of that changes the facts on investment -- facts he got wrong and continues to misstate.” Wood said Pai in no way refuted Free Press’s underlying points about investment. “Despite Pai's protests, his position on these matters is not an informed one,” Wood said. “The ISPs’ hired guns -- and even their former employees like this commissioner -- can close their eyes to the numbers, ignore the business plans of the ISPs, and spin all they want. It doesn’t change the facts that Pai so neatly avoided in his response and repeatedly misrepresented throughout this debate.” Pai was once associate general counsel at Verizon. Free Press doubled down with another fact sheet Tuesday.

NTCA’s Romano, meanwhile, still sees hope for resolution to stand-alone broadband concerns, depending on how ambitious any FCC proposal ends up being.

“A fix specifically to the standalone broadband problem is certainly achievable in the very near future,” Romano said of that concern, citing several potential ways to resolve it now. “But the question we are working through now is what other things the FCC might want to package along with that sort of targeted fix as part of a more comprehensive set of reforms.” That possibility is “of course legitimate and important” but requires “more time” given the scale, “not something that can be taken lightly or done rashly,” he said. “Some changes beyond a standalone broadband fix could likely be adopted in the near-term as well, but certain other changes the FCC is considering are more complex and therefore need to be tested, vetted, understood, and calibrated to ensure they achieve their intended purpose, avoid unintended consequences, and ultimately fulfill the fundamental mandate of universal service.”

“As summer turns to fall, I am worried that the Commission might not be on track to solve the stand-alone broadband problem by 2016,” Pai said in a statement Tuesday. “Nor can we simply announce a solution on New Year’s Eve; we need to give the public time to offer input, we need to deliberate, and then we need to deliver. This is especially important given the complexity and importance of this issue. And missing our year-end deadline should not be an option.” Pai cited the case of Dakota Central Telecom, where officials said they started offering stand-alone broadband, but stopped providing it to new customers after it became “prohibitively expensive” to offer. “However, with USF support for stand-alone broadband, Dakota Central Telecom could start offering that service to consumers again,” he said.